SECURITIES AND
EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
___________________________
FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR 12(g) OF THE
SECURITIES EXCHANGE ACT OF 1934
___________________________
COST-U-LESS, INC.
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(Exact name of registrant as specified in its charter)
WASHINGTON 91-1615590
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(State of incorporation or organization) (I.R.S. employer
identification no.)
12410 SE 32/ND/ STREET, BELLEVUE, WASHINGTON 98005
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(Address of principal executive offices) (zip code)
If this form relates to the registration of a If this form relates to the registration of a
class of debt securities and is effective upon class of debt securities and is to become
filing pursuant to General Instruction A(c)(1) effective simultaneously with the effectiveness
please check the following box. [_] of a concurrent registration statement under the
Securities Act of 1933 pursuant to
General Instruction A(c)(2) please check the
following box. [_]
SECURITIES TO BE REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT:
Title of each class Name of each exchange on which
to be so registered each class is to be registered
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None
SECURITIES TO BE REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT:
Preferred Stock Purchase Rights
(Title of class)
ITEM 1. DESCRIPTION OF REGISTRANT'S SECURITIES TO BE REGISTERED
On February 23, 1999, the Board of Directors (the "Board of Directors") of
Cost-U-Less, Inc. (the "Company") declared a dividend of one preferred share
purchase right (a "Right") for each outstanding share of common stock, par value
$.001 per share (the "Common Shares"), of the Company. The dividend was payable
on March 15, 1999 (the "Record Date") to the Company's stockholders of record on
that date. In addition, the Board of Directors has authorized the issuance of
one Right with respect to each additional Common Share that becomes outstanding
between the Record Date and the earliest of the Distribution Date, the
Expiration Date (as such terms are hereinafter defined), and the date, if any,
on which the Rights are redeemed. Each Right entitles its registered holder to
purchase from the Company one one-hundredth (1/100th) of a share of Cumulative
Preference Shares, First Series, par value $.001 per share, of the Company (the
"Preference Shares"), at a price of $40 per one one-hundredth (1/100th) of a
Preference Share (the "Purchase Price"), subject to adjustment. The description
and terms of the Rights are set forth in a Rights Agreement (the "Rights
Agreement") between the Company and ChaseMellon Shareholder Services, L.L.C., as
Rights Agent.
Until the earlier of (i) the close of business on the tenth business day
after a public announcement that a person or group (including any affiliate or
associate of such person or group) has acquired beneficial ownership of 15% or
more of the outstanding Common Shares (such person or group being an "Acquiring
Person") and (ii) such date, if any, the Board of Directors may designate
following the commencement of, or first public disclosure of an intent to
commence, a tender or exchange offer for outstanding Common Shares which could
result in the offeror becoming the beneficial owner of 15% or more of the
outstanding Common Shares (the earlier of such dates being the "Distribution
Date"), the Rights will be evidenced by the certificates for the Common Shares
registered in the names of the holders thereof (which certificates for Common
Shares will also be deemed to be Right Certificates, as defined below) and not
by separate Right Certificates. Therefore, until the Distribution Date (or
earlier redemption or expiration of the Rights), the Rights will be transferred
with and only with the Common Shares.
As soon as practicable following the Distribution Date, separate
certificates evidencing the Rights ("Right Certificates") will be mailed to
holders of record of the Common Shares as of the close of business on the
Distribution Date (and to each initial record holder of certain Common Shares
originally issued after the Distribution Date), and such separate Right
Certificates alone will thereafter evidence the Rights.
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The Rights are not exercisable until the Distribution Date and will expire
on March 15, 2009 (the "Expiration Date"), unless earlier redeemed or exchanged
by the Company as described below.
In order to preserve the actual or potential economic value of the Rights,
the number of Preferred Shares or other securities issuable upon exercise of a
Right, the Purchase Price, the Redemption Price (as hereinafter defined) and the
number of Rights associated with each outstanding Common Share are all subject
to adjustment by the Board of Directors in the event of any change in the Common
Shares or the Preference Shares, whether by reason of stock dividends, stock
splits, recapitalization, mergers, consolidations, combinations or exchanges of
securities, split-ups, split-offs, spin-offs, liquidations, other similar
changes in capitalization, any distribution or issuance of cash, assets,
evidences of indebtedness or subscription rights, options or warrants to holders
of Common Shares or Preference Shares, as the case may be, or otherwise.
In the event a person becomes an Acquiring Person, the Rights will entitle
each holder of a Right (other than an Acquiring Person (or any affiliate or
associate of such Acquiring Person)) to purchase, for the Purchase Price, that
number of Prefernece Shares equivalent to one one-hundredth (1/100) of the
number of Common Shares which at the time of the transaction would have a market
value of twice the Purchase Price. Any Rights that are at any time beneficially
owned by an Acquiring Person (or any affiliate or associate of an Acquiring
Person) will be null and void and nontransferable and any holder of any such
Right (including any purported transferee or subsequent holder) will be unable
to exercise or transfer any such Right.
After there is an Acquiring Person, the Board of Directors may elect to
exchange each Right (other than Rights that have become null and void and
nontransferable as described above) for consideration per Right consisting of
one-half of the number of Preference Shares that would be issuable at such time
upon the exercise of one Right pursuant to the terms of the Rights Agreement
(or, if Common Shares are available, a number of Common Shares equivalent to 100
times such number of Preference Shares), and without payment of the Purchase
Price.
If the Company is acquired in a merger by, or other business combination
with, or 50% or more of its assets or assets accounting for 50% or more of its
net income or revenues are sold, leased, exchanged or otherwise transferred (in
one or more transactions) to, a publicly traded corporation, each Right will
entitle its holder (subject to the next paragraph) to purchase, for the Purchase
Price, that number of shares of common stock of such corporation which at the
time of the transaction would have a market value of twice the Purchase Price.
If the Company is acquired in a merger by, or other business combination with,
or 50% or more of its assets or
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assets accounting for 50% or more of its net income or revenues are sold,
leased, exchanged or otherwise transferred (in one or more transactions), to an
entity that is not a publicly traded corporation, each Right will entitle its
holder (subject to the next paragraph) to purchase, for the Purchase Price, at
such holder's option, (i) that number of shares of the surviving corporation in
the transaction (which surviving corporation could be the Company) which at the
time of the transaction would have a book value of twice the Purchase Price,
(ii) that number of shares of the ultimate parent entity of the surviving
corporation which at the time of the transaction would have a book value of
twice the Purchase Price, or (iii) if the acquiring entity has an affiliate
which has publicly traded common shares, that number of common shares of such
affiliate which at the time of the transaction would have a market value of
twice the Purchase Price.
At any time prior to any person or group becoming an Acquiring Person, the
Board of Directors may redeem the Rights in whole, but not in part, at a price
(in cash or Common Shares or other securities of the Company deemed by the Board
of Directors to be at least equivalent in value) of $.01 per Right, subject to
adjustment as provided in the Rights Agreement (the "Redemption Price").
At any time prior to the Distribution Date the Company may, without the
approval of any holder of the Rights, supplement or amend any provision of the
Rights Agreement (including the date on which the Distribution Date would occur,
the time during which the Rights may be redeemed or the terms of the Preference
Shares).
The Preference Shares issuable upon exercise of the Rights will not be
redeemable. The holders of the Preferred Shares will be entitled to a
preferential quarterly dividend payment equal to the greater of (a) $.01 per
share and (b) 100 times the dividend declared per Common Share, if any. In the
event of dissolution, liquidation or winding up of the Company, whether
voluntary or involuntary, the holders of Preference Shares will be entitled to a
preferential payment per share of all accrued and unpaid dividends and
distributions per share, plus 100 times the distribution to be made per Common
Share. Each Preference Share will entitle its holder to 100 votes, voting
together with the Common Shares. Finally, in the event of any merger, business
combination, consolidation or other transaction in which the Common Shares are
exchanged, the holders of the Preference Shares will be entitled to receive per
share 100 times the amount received per Common Share.
Because of the nature of the Preference Shares' dividend liquidation and
voting rights, the value of the one one-hundredth (1/100th) interest in a
Preference Share issuable upon exercise of each Right should approximate the
value of one Common Share. Customary antidilution provisions are designed to
protect that relationship in the event of certain changes in the Common Shares
and the Preference Shares. The Preference Shares are authorized to be issued in
fractions which are an integral
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multiple of one one-hundredth (1/100th) of a Peference Share. The Company may,
but is not required to, issue fractional shares upon the exercise of Rights and,
in lieu of fractional shares, the Company may utilize a depository arrangement
as provided by the terms of the Preference Shares and, in the case of fractions
other than one one-hundredth (1/100th) of a Preference Share or integral
multiples thereof, may make a cash payment based on the market price of such
shares.
Until a Right is exercised, the holder thereof, as such, will have no
rights as a stockholder of the Company, including, without limitation, the right
to vote or receive dividends.
As of March 15, 1999, there were approximately 3,539,961 Common Shares of
the Company outstanding. Each Common Share of the Company outstanding at the
close of business on March 15, 1999, will receive one Right. The Board of
Directors of the Company has reserved sufficient Preference Shares for issuance
upon exercise of the Rights.
The Rights have certain antitakeover effects. The Rights will cause
substantial dilution to a person or group that attempts to acquire the Company
on terms not approved by the Board of Directors. The Rights should not affect
any prospective offeror willing to make an all-cash offer at a full and fair
price, or willing to negotiate with the Board of Directors of the Company. The
Rights will not interfere with any merger or other business combination approved
by the Board of Directors since the Board of Directors may, at its option,
redeem all but not less than all of the then outstanding Rights at the
Redemption Price.
A copy of the Rights Agreement is attached as Exhibit 2.1 hereto. A copy
of the Rights Agreement is available free of charge from the Company. This
summary description of the Rights does not purport to be complete and is
qualified in its entirety by reference to the Rights Agreement, which is hereby
incorporated herein by reference.
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ITEM 2. EXHIBITS
1.1 Form of Right Certificate, incorporated by reference to Exhibit B
to Exhibit 2.1 filed herewith.
2.1 Rights Agreement dated as of March 15, 1999, between Cost-U-Less,
Inc. and ChaseMellon Shareholder Services, L.L.C..
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SIGNATURE
Pursuant to the requirements of Section 12 of the Securities Exchange Act
of 1934, as amended the registrant duly caused this registration statement to be
signed on its behalf by the undersigned, thereto duly authorized.
Date: March 15, 1999
Cost-U-Less, Inc..
By /s/ Allan C. Youngberg
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Allan C. Youngberg
Vice President-Chief Financial Officer, Secretary
and Treasurer
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EXHIBIT INDEX
Exhibit Number Description
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1.1 Form of Right Certificate, incorporated by reference to
Exhibit B to Exhibit 2.1 filed herewith
2.1 Rights Agreement dated as of March 15, 1999, between
Cost-U-Less, Inc. and ChaseMellon Shareholder Services,
L.L.C., as Rights Agent.
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